Prospecting vs Lead Generation: What’s the Difference?
Contrary to common belief, prospecting and lead generation are not the same.
Their aims and methods differ significantly. There are specific situations where one is more effective than the other.
In this article, we’ll look at the differences between sales prospecting vs lead generation and which approach works best when.
Scroll 👇 to find out everything about prospecting vs lead generation.
How is prospecting different from lead gen?
Prospecting is an activity usually carried out by sales reps, on a one-to-one basis. The idea is to generate interest from targets who may not know who you are.
Unlike lead gen, it’s typically a short-term approach, a quick way to identify and qualify new clients, then move them through the sales funnel.
The types of B2B prospecting activities that sales reps engage in include:
- Cold calling
- Outbound emailing
- LinkedIn direct messaging
Our training video explores the most successful sales prospecting techniques - press ▶️ to watch!
How is lead generation different from prospecting?
On the other hand, lead generation is commonly a marketing activity and a one-to-many approach. It’s a long-term, slower method of building awareness and engagement from a wider target market than prospecting.
Leads tend to be pre-qualified and warmer than prospects; this is because they’ve already engaged with your marketing content and brand.
Here are some B2B lead generation strategies:
- Landing pages
- Downloadable whitepaper
- Pop-up forms
Watch our explainer video to find out more about lead generation 👇
How do you know which one to use?
Not knowing whether you should use sales prospecting or lead generation can result in empty pipelines. So it’s essential you employ the right approach at the right time.
Choose a prospecting approach if your pipeline is looking light and you need to replenish it quickly. For example, you can book appointments with qualified leads, fast. To succeed, you will have to think on your feet and be comfortable with frequent rejection.
On the other hand, if time is on your side, lead generation is a better way to go. It’s a longer-term approach that usually gets a better quality of lead further down the line.
Start by defining your Ideal Customer Profile and then create content that’s 100% focused on that persona. By enticing new business to your brand, you will build awareness and grow engagement. And ultimately, fill your pipeline with a steadier flow of warm and hot leads.
You can also invest in lead generation tools to help accelerate your pipeline.
Is prospecting the same as lead generation?
The short answer is no!
Prospecting is the first step in a sales process, while lead generation is related to marketing.
Sales teams use prospecting for finding relevant potential buyers, while lead generation specialists work on attracting customer interest and converting it into a sale.
The boundaries between those terms are not often clear. So much so a new term was coined—
So can you prospect leads?
The answer again is no. The term lead prospecting is a result of confusing prospecting and lead generation.
If you need more information on this, read our guide to prospect vs lead differences or look at the examples of what both approaches mean in practice.
If you need to start prospecting, here are some things you can try:
- Emailing – compile a B2B sales lead list that matches your ideal customer profile and hit them with a short, yet attention-grabbing email, as personalised as possible.
- Cold calling – get your prospects on the phone, qualify them to check they have a need for your product (as well as the authority to buy and the budget), then arrange a meeting to get to know them better. Cognism has published several articles on cold calling.
- Social selling – contact your prospects on LinkedIn and start a conversation that will result in arranging a call.
Lead generation examples
If you want to start a lead generation process, here are some ideas:
- Content marketing – create marketing content that engages your audience, such as blogs, webinars, eBooks, or whitepapers. You can put them behind a gate, so a prospect would need to give you their email address before they can access them.
- Account-based marketing (ABM) – a lead gen method that is growing in popularity, ABM involves reaching out to different people within the same target account, but with personalised content that
When prospecting and lead generation work together
Prospecting is more of a sales team activity, while lead generation will usually come from marketing. However, it’s much more powerful when the two functions work together.
In any B2B or SaaS organisation, sales teams and marketing teams should be closely aligned. Their common aim should be bringing high-quality, targeted leads into the funnel. Sales and marketing should get together and set out their quarterly objectives.
To get a perfect balance between lead generation vs prospecting means that they should also agree on a sales strategy, the definitions of a lead, and anything else that gets them working better together. It will stop the two teams from duplicating work and treading on each other’s toes.
These stats prove how powerful aligned sales prospecting and lead generation can be together:
- Closing deals is 67% more efficient
- Customer retention is 36% higher
- Sales win rates increase by 38%
- Revenue growth and profit growth are respectfully 24% and 27% faster over three years
Tip! You may also want to learn the difference between demand generation vs lead generation.
Looking for more sales prospecting and lead gen insights? Sign up for Cognism’s newsletters! Click 👇